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Activists uneasy about Kenner's nomination to Events D.C. board

1 hour 27 minutes ago
As Brian Kenner, once the District’s top economic development official, moves closer to earning a spot on the Events D.C. board, some local activists have raised concerns that he will offer his new employer, Amazon.com Inc., an inside track into D.C. government as its influence continues to rise across the Potomac River. Kenner left his position as deputy mayor for planning and economic development (DMPED) in June to join the government affairs shop at Amazon (NYSE: AMZN).

Saudi Aramco Set to Pay Banks Only $64 Million for Record IPO

1 hour 42 minutes ago
(Bloomberg) -- Saudi Aramco is poised to pay a combined $64 million to the banks that arranged the world’s largest initial public offering, a letdown for the Wall Street firms that pitched aggressively for a spot on the deal, people with knowledge of the matter said.The state oil giant plans to pay the top local banks on the deal -- known as joint global coordinators -- 39 million riyals ($10.4 million) apiece, according to the people. The top foreign banks on the deal are set to each get 13 million riyals, or the equivalent of $3.5 million, the people said.Aramco raised $25.6 billion in its share sale, which became a local affair after foreign fund managers shunned its premium valuation. The total fee amount, which represents 0.25% of the funds raised, pales in comparison to other large deals. Chinese internet giant Alibaba Group Holding Ltd., which raised $25 billion in its 2014 IPO, paid about $300 million to its underwriters.IPO banks globally earned average fees equal to 4.1% of the deal size this year, up from 3.6% last year, according to data compiled by Bloomberg.Saudi Arabia didn’t need the Wall Street firms’ international networks after it scrapped roadshows outside the Middle East, turning instead to local retail buyers and wealthy families to shore up the deal. The foreign underwriters on the deal will barely make enough to cover their costs, Bloomberg News has reported.Aramco will pay local banks serving as bookrunners, a more junior role, about 5 million riyals each while foreign banks in that position will be paid about 2 million riyals apiece, the people said. The company declined to comment. (Updates with fee comparison, deal background from third paragraph.)\--With assistance from Dinesh Nair.To contact the reporters on this story: Sarah Algethami in Riyadh at salgethami@bloomberg.net;Matthew Martin in Dubai at mmartin128@bloomberg.net;Archana Narayanan in Dubai at anarayanan16@bloomberg.netTo contact the editors responsible for this story: Ben Scent at bscent@bloomberg.net, ;Stefania Bianchi at sbianchi10@bloomberg.net, Matthew MonksFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

Chip Analysts Struggle to Get Excited About 2020 After Rally

2 hours 3 minutes ago
(Bloomberg) -- After a year in which semiconductor stocks defied conventional wisdom with a seemingly unstoppable rally in the face of gloomy fundamentals, analysts are loathe to go all in.With signs of a rebound in demand still scant, the key question for the new year is where chipmaker shares can go when they’re trading at the highest price to future earnings multiples in nearly a decade. Most analysts expect business to improve in 2020, aided by things like 5G technology and cloud infrastructure spending. But valuations are cause for concern, especially when accounting for lingering tariff uncertainty.“It is challenging to argue that a good amount of the future return potential hasn’t simply been pulled forward on hope,” said Bernstein analyst Stacy Rasgon.At the end of 2018, most of Wall Street saw little to get excited about in the semiconductor industry. Chipmakers had begun axing forecasts as customer orders slowed and inventories swelled as the U.S.-China trade war heated up. Despite all of that, the Philadelphia semiconductor index embarked on a relentless advance, logging just two down months the entire year.The gauge that tracks 30 semiconductor-related stocks has risen 56% so far in 2019, which would be the biggest annual gain in a decade. That eye-popping number was aided by a brutal market sell-off at the end of 2018 that hit technology stocks particularly hard. Chip shares notched new highs Thursday after President Trump said the U.S. and China are “very close” to a “big” trade deal.To keep the rally going, semiconductor companies will need to start posting better-than-expected financial results, according to Morgan Stanley analyst Joseph Moore, who was one of the first analysts on Wall Street to get cautious on the group in the second half of 2018. Moore now advocates holding a select group of stocks including Intel Corp. and Nvidia Corp., which he expects to benefit from higher cloud spending in 2020.“The period where stocks are going to go up on bad numbers is largely behind us,” he said in an interview. “If the numbers come up, then we can have some good performance. I don’t think there’s room for these multiples to come up too much more.”In that regard, the third quarter was a good start. With results in from all members of the chip benchmark except for Broadcom Inc., more than three-quarters of companies beat profit and revenue estimates, according to data compiled by Bloomberg.Still other indicators are worrisome. Inventory levels for many chipmakers remain elevated, according to Moore, and tariffs haven’t been resolved. U.S. goods on some electronics imported from China are set to increase on Dec. 15 if there’s no trade deal.Despite the trade uncertainty, 2020 is “looking decent” from a fundamental standpoint, according to Bloomberg Intelligence analyst Anand Srinivasan. He expects cloud spending to improve, 5G spending to kick in, and stability in mobile devices and personal computers.“The growth themes that we have been positing are going to be manifested in 2020, particularly in the second half,” he said. “We think it still could be a bumpy ride from a stock perspective but we feel optimistic about 2020.”See AlsoSoftware Analysts See More Volatility in an Uncertain 2020Airbus Secures Lead Over Boeing as 737 Max Weighs Into 2020After ‘Blood-Spilled’ Year, Pot Firms Brace for Repeat in 2020Small-Caps Set to Retake 2020 Market Lead After Three-Year LagS&P 500 Melt-Up Is So Hot It’s Making Cheerleaders Into Skeptics(Updates shares and Trump comments in fifth paragraph, adds P/E chart.)\--With assistance from Lu Wang.To contact the reporter on this story: Jeran Wittenstein in San Francisco at jwittenstei1@bloomberg.netTo contact the editors responsible for this story: Catherine Larkin at clarkin4@bloomberg.net, Jennifer Bissell-LinskFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

Facebook delays naming oversight board members until 2020

2 hours 6 minutes ago
Facebook will not announce the first members of its independent oversight board this year as it originally expected, the company said on Thursday. The board is one of Facebook's high-profile efforts to respond to criticism over how it handles problematic content and transparency around its decision-making. It will now probably not name the board's co-chairs and first members until after January 2020.

Giant permit pulled for Amazon's Raleigh facility

2 hours 44 minutes ago
A rather massive building permit has been pulled for Amazon.com's sort facility in Raleigh. The sort facility/warehouse at 4055 New Allen Road is called "Project Iris" on the permit, but Amazon is the owner of the property. Project Iris first came to the public's attention in August; it was approved by the Memphis & Shelby County Board of Adjustment in September; and the 98-acre property was bought and an $8 million permit was pulled in November.
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